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Elements of Consumer Behavior, and Defining the Market Hierarchy

Elements of Consumer Behavior, and Defining the Market Hierarchy. BA396 Supplement. Need Recognition. Information Search. Information Evaluation. Purchase Decision. Post-purchase Attitude Formation. Consumer Behavior. EKB Model. Need Recognition. Information Search.

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Elements of Consumer Behavior, and Defining the Market Hierarchy

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  1. Elements of Consumer Behavior, and Defining the Market Hierarchy BA396 Supplement

  2. Need Recognition Information Search Information Evaluation Purchase Decision Post-purchase Attitude Formation Consumer Behavior • EKB Model

  3. Need Recognition Information Search Information Evaluation Purchase Decision Post-purchase Attitude Formation Consumer Behavior • EKB Model Needs: * Functional - product related * Psychological - stimulation - social - status/power - self-reward Information: * Amount of information * Sources - internal/external * Reduce search?

  4. Need Recognition Information Search Information Evaluation & Trial Adoption Purchase Decision Post-purchase Attitude Formation Consumer Behavior • Buying Process and Decision Making

  5. Need Recognition Information Search Information Evaluation & Trial Adoption Purchase Decision Post-purchase Attitude Formation Consumer Behavior • Buying Process and Decision Making Habitual Decision Making Limited Problem Solving Extended Problem Solving

  6. Consumer Behavior • Who are your competitors, and how do customers end up selecting your product? • Hierarchy of Markets • Competition at different ‘levels’ • Try to understand consumer’s decision process • Within a household competition regarding the importance of different generic markets • this will increase when resources are limited -- transportation will compete with food or housing

  7. Consumer Behavior • Hierarchy of Markets • Desire • all products and services that compete for the consumer’s dollars • Generic Level • demand for broadly defined need • Specific Product Level • car, bicycle, single family dwelling, apt. • Brand • Honda, Chevrolet, Schwinn, Trek, BikEE

  8. Hierarchy of Markets Diet Food • Example 1 prepared unprepared Entrée Supplement fresh frozen fresh frozen restaurant Store Deli Stouffers Weight Watchers

  9. Hierarchy of Markets • Example 2 Food prepared unprepared Entrée Supplement S E ‘Fast’ Sit-down Mexican American Asian Asian American

  10. Census Information • http://www.census.gov/dmd/www/products.html • Click on “intro to Census 2000 data products”  United States (PDF) • Click on the Public Use Presentation Library and browse through the different presentations • About ½ way down the list, there is presentation on the geographic concepts discussed in class. Look for: • Title: Census 2000: Geographic Concepts and Products (September 2002) Number of slides: 36Description: This presentation gives an overview of Census 2000 geographic concepts and products and the various geographic units for which Census 2000 data are available.

  11. Census Information • http://www.census.gov/dmd/www/products.html • Click on the Public Use Presentation Library and browse through the different presentations • About the sixth presentation on the list, there is presentation that covers the short form and long form information. Look for: • Title: Census 2000: and Its Data Products (September 2002)Number of slides: 41Description: An overview of the Census 2000 questions, the data sets, and the products released and the released media.

  12. Segmentation Requirements • Customers have different response elasticities • Salesx1=Advx.5x SalesPrx.2x Distrx.3 • Salesx2=Advx.2x SalesPrx.4x Distrx.2 • Response differences can be identified and matched with customer descriptions • Knowledge of market segments must be translatable to retail mix combinations • Sufficient demand in at least one segment • Characteristics stable over time

  13. Bases of Segmentation • Geographic • Nations, regions, states • Demographic • Age, gender, family size, income • Psychographic • Social class, lifestyle, personality, AIO inventories • Behavioral • Usage rate, occasion for use, benefits, loyalty

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